Gold Prices Make Double Top

New York (July 5)  Wednesday saw gold repeat a pattern that it had just a week earlier -- a huge blow-off to the upside that failed. This time the pattern repeated and gold made a double top, only to fall back into the consolidation pattern it has been forming over the last couple of weeks.

If you go back to early May when this rally began, the patterns have repeated almost identically but continue to make higher lows and higher highs, indicating that there is more room to the upside and the rally should continue.

Gold has rallied 10% from the recent lows and has its sights set on our next target of $1,500. Although gold bulls would like nothing better than a straight up move, the recent action is more bullish and the longer it can remain in this pattern of consolidation, the greater likelihood for a continuation of this rally

Silver is trying to join the party as well and is in a similar consolidation pattern. If silver can hold the $15.10 level, then $16 becomes a very realistic next target. First real resistance in silver is $15.60.

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